CANCELLATION No 13745 C (INVALIDITY)

Frog Design, Inc., 660 Third Street, 4th Floor, San Francisco, CA 94107, United States of America, (applicant), represented by Mitscherlich, Patent-Und Rechtsanwälte, Part mbB, Sonnenstraße 33, 80331 München, Germany (professional representative)

a g a i n s t

Frogsy Limited, 67 Kennedy Avenue Athienitis Kennedy Park, 1076 Nicosia, Cyprus, (EUTM proprietor), represented by G.Leontiou, LLC, Nancia Koukounis, 67 Kennedy Avenue Athienitis Kennedy Park, 4th floor, Suite 401, 1076 Nicosia, Cyprus (professional representative).

On 17/07/2017, the Cancellation Division takes the following

DECISION

1.        The application for a declaration of invalidity is upheld.

2.        European Union trade mark No 13 985 205 is declared invalid in its entirety.

3.        The EUTM proprietor bears the costs, fixed at EUR 1 080.

REASONS

The applicant filed an application for a declaration of invalidity against all the services of European Union trade mark No 13 985 205. The application is based on, inter alia, European Union trade mark registration No 9 955 675.

The applicant invoked Article 53(1)(a) EUTMR in connection with Article 8(1)(a) and (b) and Article 8(5) EUTMR.

SUMMARY OF THE PARTIES’ ARGUMENTS

The applicant argues that there is an obvious likelihood of confusion due to the identity and high similarity between the services and the similarity of the signs. It adds that the elements ‘DESIGN’, ‘VENTURES’ and ‘LAB’ included in some of the earlier marks are purely descriptive with respect to the relevant services therefore these earlier marks are dominated by the element ‘FROG’.

The applicant also claims that the earlier marks enjoy a high degree of distinctiveness due to their long standing and extensive use throughout the European Union. It also emphasizes that it is one of the globally best known brands in the field of industrial design and innovation. The applicant considers that there is no doubt that the use of the contested mark would take unfair advantage of, and be detrimental, to the distinctive character and the repute of the earlier marks.

In support of its observations, the applicant filed the following evidence:

• An extract from Wikipedia dated 2016 which explains the background of the company Frog Design Inc.

• An extract from the web page www.frogdesign.com titled “The Story of Frog” which includes the history and the different stages of the company.

• An extract from Merriam Webster including the definition of ‘LAB’.  

The EUTM proprietor did not submit any arguments in reply.

LIKELIHOOD OF CONFUSION — ARTICLE 53(1)(a) EUTMR IN CONNECTION WITH ARTICLE 8(1)(b) EUTMR

A likelihood of confusion exists if there is a risk that the public might believe that the goods or services in question, under the assumption that they bear the marks in question, come from the same undertaking or, as the case may be, from economically linked undertakings. Whether a likelihood of confusion exists depends on the appreciation in a global assessment of several factors, which are interdependent. These factors include the similarity of the signs, the similarity of the goods and services, the distinctiveness of the earlier mark, the distinctive and dominant elements of the conflicting signs and the relevant public.

The application is based on more than one earlier trade mark. The Cancellation Division finds it appropriate to first examine the application in relation to the applicant’s European Union trade mark registration No 9 955 675.

1. The goods and services

The relevant factors relating to the comparison of the goods or services include, inter alia, the nature and purpose of the goods or services, the distribution channels, the sales outlets, the producers, the method of use and whether they are in competition with each other or complementary to each other.

The goods and services on which the application is based are, inter alia, the following services:

Class 35: Advertising, business and marketing consulting services; business consultation, namely, corporate identity and branding strategies consultation; online directory services, namely, providing indexes and website links to other content providers featuring editorials and articles in the fields of marketing and electronic commerce; assistance, advisory services and consultancy with regard to business planning, business analysis, business management, business organization, marketing and customer analysis; marketing services, namely, conducting consumer tracking behavior research and consumer trend analysis; marketing services, namely, consumer marketing research; business consultation and management regarding marketing activities and launching of new products.        

Class 42: Providing virtual computer systems and virtual computer environments through cloud computing; computer network management services; computer software and hardware design and engineering services; design and engineering consulting services; architecture services; computer software research and development services; installation of computer software; updating of computer software for others; computer programming; computer systems integration services; testing and maintenance of computer hardware and software; consultancy in the field of computer software; consultancy in the field of telecommunication processes optimization and automation, and network management systems; systems integration services, namely, integrating and testing software and hardware components of others; managing and maintaining software that is located at the customer’s location and delivering a set of technical services for a fixed monthly price that includes hardware and software support; hosting computer equipment of others; computer hardware and software technical support services; new product research and design services; design and testing for new product development; design and testing of new products for others; packaging design; interior design services; retail signage design; planning and layout design for the interior space of retail business establishments.

The contested services are the following:

Class 35: Advertising, marketing and promotional services; Business analysis, research and information services; Business assistance, management and administrative services; Commercial trading and consumer information services.

Class 42: Design services; IT services; Science and technology services; Testing, authentication and quality control.

An interpretation of the wording of the lists of services is required to determine the scope of protection of these services.

The term ‘namely’, used in the applicant’s lists of services to show the relationship of individual services with a broader category, is exclusive and restricts the scope of protection only to the specifically listed services.

Moreover, it is to be noted that according to Article 28(7) EUTMR, goods or services shall not be regarded as being similar or dissimilar to each other on the ground that they appear in the same or different classes under the Nice Classification.

The relevant factors relating to the comparison of the goods or services include, inter alia, the nature and purpose of the goods or services, the distribution channels, the sales outlets, the producers, the method of use and whether they are in competition with each other or complementary to each other.

Contested services in Class 35

Advertising is identically contained in both lists of services.

The contested marketing and promotional services are included in the broader category of the applicant’s advertising. Therefore, the services are identical.

The contested business management is included in, or overlaps with the applicant’s business services. Therefore, they are identical. 

The contested business analysis overlaps with the applicant’s assistance, advisory services and consultancy with regard to business analysis. Hence, they are identical.

Business research is the analysis and interpretation of economic information, such as income, employment, taxes, and demographics. This research information is used by entrepreneurs to make business decisions such as establishing marketing strategies. The contested business research is identical to the applicant’s business services which are usually rendered by companies specialised in this specific field such as business consultants. These companies gather information and provide tools and expertise to enable their customers to carry out their business or provide businesses with the necessary support to acquire, develop and expand market share. The services involve activities such as business research and appraisals, cost price analysis and organisation consultancy.

The same reasoning applies to the contested business information services; business assistance and administrative services. They are identical to the applicant’s business services since the applicant’s services include any ‘consultancy’, ‘advisory’ and ‘assistance’ activity that may be useful in the ‘management of a business’, such as how to efficiently allocate financial and human resources, how to improve productivity, how to increase market share, how to deal with competitors, how to reduce tax bills, how to develop new products, how to communicate with the public, how to do marketing, how to research consumer trends, how to launch new products, how to create a corporate identity, etc.

On the other hand, commercial trading and consumer information services all relate to the provision to the customers of details and data about how to act in commerce, international markets, information on the organisation of a business, including the provision of the description of products to promote and sell them.

The applicant’s advertising services consist of providing others with assistance in the sale of their goods and services by promoting their launch and/or sale, or of reinforcing the client’s position in the market and acquiring competitive advantage through publicity. In order to fulfil this target, many different means and products might be used. These services are provided by specialised companies which study their client’s needs and provide all the necessary information and advice for the marketing of their products and services, and create a personalised strategy regarding the advertising of their goods and services through newspapers, web sites, videos, the internet, etc.

Therefore, a certain similarity exists between the contested services commercial trading and consumer information services and the applicant’s advertising insofar as both have the same purpose (assist others in selling their products and services), can be provided by the same companies and are addressed at the same end consumers. These services are similar to a low degree.

Contested services in Class 42

The contested design services include, as a broader category, the applicant’s interior design services. Since the Cancellation Division cannot dissect ex officio the broad category of the contested services, they are considered identical to the applicant’s services.

IT is the short form for information technology which is the study or use of systems (especially computers and telecommunications) for storing, retrieving, and sending information. The contested IT services include, as a broader category, the applicant’s installation of computer software; updating of computer software for others; computer programming; computer systems integration services. Since the Cancellation Division cannot dissect ex officio the broad category of the contested services, they are considered identical to the applicant’s services.

The contested testing includes, as a broader category, the applicant’s testing for new product development. Since the Cancellation Division cannot dissect ex officio the broad category of the contested services, they are considered identical to the applicant’s services.

On the other hand, the contested authentication and quality control are the processes or actions of proving or showing something to be true, genuine, or valid and the systems of maintaining standards in manufactured products by testing a sample of the output against the specification respectively. They are highly similar to the applicant’s testing for new product development since they can be part of the same processes and they can be provided by the same companies or specialists. They coincide in nature, purpose and method of use. Furthermore, they can be distributed through the same channels to the same end users.  

Finally, the contested science and technology services are similar to the applicant’s design of new products for others as they share the same nature, same purpose and same distribution channels. Moreover, they can be provided by the same specialists or companies.

2. Relevant public — degree of attention

The average consumer of the category of products concerned is deemed to be reasonably well informed and reasonably observant and circumspect. It should also be borne in mind that the average consumer’s degree of attention is likely to vary according to the category of goods or services in question.

The services found to be identical or similar to various degrees are directed at the business customers with specific professional knowledge or expertise in the different fields. The degree of attentiveness is enhanced (in relation to for example business consulting services which may be contracted infrequently, can be expensive and can have serious, long-term consequences to the user).

3. The signs

FROG DESIGN	Frogsy
Earlier trade mark	Contested trade mark

The relevant territory is the European Union.

The global appreciation of the visual, aural or conceptual similarity of the marks in question must be based on the overall impression, bearing in mind their distinctive and dominant components (11/11/1997, C-251/95, Sabèl, EU:C:1997:528, § 23).

Both marks are word signs. The earlier mark consists of the elements ‘FROG’ and ‘DESIGN’ whereas the contested mark consists of the sole element ‘Frogsy’.

The word ‘FROG’ of the earlier mark is an English word which means a tailless amphibian with a short squat body, moist smooth skin, and very long hind legs for leaping and it will be understood by those consumers with a sufficient level of English. Since it has no relation with the relevant services, it is therefore distinctive.

However, the element ‘DESIGN’ of the earlier mark will be associated with, inter alia, a planning that exists behind an action, fact, or object by the relevant public with a sufficient knowledge of English. Bearing in mind the relevant services in Classes 35 and 42, this element is descriptive and non-distinctive for these services since it directly refers to the kind or the characteristics of the services being provided or it is closely related to.

The element ‘Frogsy’ of the contested mark is, as such, a fanciful word. However, it cannot be denied that a part of the English-speaking part of the public would inevitably associate the word with ‘frog’. The inclusion of ‘sy’ makes it sound like a nickname based on a Frog or a playful character (being a frog). Be as it may be, since it has no relation with the relevant services, it is therefore distinctive.

The unitary character of the European Union trade mark means that an earlier European Union trade mark can be relied on in proceedings for a declaration of invalidity against any European Union trade mark that would adversely affect the protection of the first mark, even if only in relation to the perception of consumers in part of the European Union (18/09/2008, C-514/06 P, Armafoam, EU:C:2008:511, § 57, by analogy). Therefore, a likelihood of confusion for only part of the relevant public of the European Union is sufficient to declare the contested trade mark invalid. In the present case, the Cancellation Division finds it appropriate to focus the comparison of the signs on the English-speaking part of the relevant public since the elements ‘FROG’, ‘DESIGN’ and ‘Frogsy’ included in both marks respectively are meaningful in those countries where English is understood.

Visually, the signs coincide in the sequence of letters ’frog**’, which form the first and distinctive element of the earlier mark and the beginning of the contested mark. However, they differ in the last letters ‘sy’ of the contested mark and in the descriptive and non-distinctive element ‘DESIGN’ included in the earlier mark. Therefore, the signs are visually highly similar.

Aurally, the pronunciation of the signs coincides in the sound of the letters ‛frog**’, present identically in both signs. The pronunciation differs in the sound of the last letters /sy/ of the contested mark and in /design/ of the earlier mark which was found to be descriptive and non-distinctive. The distinctive elements of both marks include four and six letters respectively of which /frog/ are contained in the same place and order. Their rhythm and intonation is therefore alike.  

Therefore, the signs are aurally highly similar.

Conceptually, although the public in the relevant territory will perceive the meaning of the elements of the earlier mark, as explained above, the other sign has no meaning in that territory for a part of the public. Since one of the signs will not be associated with any meaning, the signs are not conceptually similar for that part of the public.

However, as explained above, another part of the relevant public will perceive the concept of a ‘frog’ in ‘Frogsy’ of the contested mark. For that part of the public, the signs are conceptually similar to a high degree on account of the common concept conveyed by ‘frog’ taking account the descriptive and non-distinctive character of the term “design” included in the earlier mark.

As the signs have been found similar in at least one aspect of the comparison, the examination of likelihood of confusion will proceed.

4. Distinctiveness of the earlier mark

The distinctiveness of the earlier mark is one of the factors to be taken into account in the global assessment of likelihood of confusion.

According to the applicant, the earlier trade mark enjoys a high degree of distinctiveness as result of its long-standing and intensive use in the European Union for all goods and services for which it is registered. This claim must be properly considered given that the distinctiveness of the earlier trade mark must be taken into account in the assessment of likelihood of confusion. Indeed, the more distinctive the earlier mark, the greater will be the likelihood of confusion (11/11/1997, C-251/95, Sabèl, EU:C:1997:528), and, therefore, marks with a highly distinctive character because of the recognition they possess on the market, enjoy broader protection than marks with a less distinctive character (29/09/1998, C-39/97, Canon, EU:C:1998:442). The contested mark was filed on 24/04/2015 and therefore the applicant was required to show enhanced distinctive character of the earlier mark before that date. In addition, the high distinctive character of the earlier mark must still exists when the decision on invalidity is taken.

The applicant submitted the evidence which was listed above. Having examined the evidence, the Cancellation Division concludes that it does not demonstrate that the earlier trade mark acquired a high degree of distinctiveness through use. The evidence is either undated or is dated after the filing date. The applicant did not file any other supporting document such as a survey on the mark’s recognition that supports the finding of brand awareness (such as a survey on the recognition of the mark among the public, publicly audited turnover, etc.) under the earlier trade mark and that the company has led its resources to reach the threshold of enhanced distinctive character. Therefore, this claim is rejected as unfounded.

Consequently, assessment of the distinctiveness of the earlier mark will rest on its distinctiveness per se. In the present case, the earlier trade mark as a whole has no meaning for any of the services from the perspective of the public in the relevant territory. Therefore, the distinctiveness of the earlier mark must be seen as normal despite the presence of a descriptive and non-distinctive element in the mark as stated above in section c) of this decision.

5. Global assessment, other arguments and conclusion

For the purposes of that global appreciation, the average consumer of the category of products concerned is deemed to be reasonably well-informed and reasonably observant and circumspect. However, account should be taken of the fact that the average consumer only rarely has the chance to make a direct comparison between the different marks but must place his trust in the imperfect picture of them that he has kept in his mind. It should also be borne in mind that the average consumer’s level of attention is likely to vary according to the category of goods or services in question (see 22/06/1999, C-342/97, Lloyd Schuhfabrik, EU:C:1999:323).

The services have been found to be partially identical and partially similar to various degrees.

Taking into account all the above, and especially the fact that the marks share the sequence of letters ‘FROG**’, it is considered that the additional term of the earlier mark which is descriptive and non-distinctive for the relevant services and the last letters ‘sy’ of the contested mark cannot counteract the visual, aural and, when applicable, conceptual similarities between the signs so as to exclude a likelihood of confusion even if the level of attention of the consumers is enhanced. A high degree of attention does not automatically lead to a finding of no likelihood of confusion. All other factors have to be taken into account. A likelihood of confusion can exist despite a high degree of attention. For example, when there is a strong likelihood of confusion created by other factors, such as identity or close overall similarity of the marks and the identity of the goods, the attention of the relevant public alone cannot be relied upon to prevent confusion (21/11/2013, T-443/12, ancotel, EU:T:2013:605, § 53-56, decision of 06/09/2010, R 1419/2009-4, ‘Hasi’).

In the present case, the relevant consumers may think that the identical and similar services come from the same or from economically-related companies. Those consumers might focus on the sequence of letters ‘frog’, when remembering the marks based on the imperfect recollection of them and might consequently not notice the difference between them, or they might link the trade marks based on the common distinctive sequence of letters ‘frog’ and therefore assume that the contested mark is a sub-brand of services connected to the earlier mark.

In addition, the Cancellation Division notes that the likelihood of confusion includes the likelihood of association, in the sense that the public may, if not confuse the two signs directly, believe that they come from the same undertaking or from economically related ones (see 11/11/1997, C-251/95, Sabèl, EU:C:1997:528, § 16). In the present case, the consumer may easily conclude that the services labelled and offered under the contested mark come from the same or from an economically-linked undertaking as the earlier mark.  

Considering all the above, there is a likelihood of confusion on the part of the English-speaking part of the public. As stated above in section c) of this decision, a likelihood of confusion for only part of the relevant public of the European Union is sufficient to declare the contested trade mark invalid.

Therefore, the application is well founded on the basis of the applicant’s European Union trade mark registration No 9 955 675. It follows that the contested trade mark must be declared invalid for all the contested services found identical or similar.

It also has to be noted that likelihood of confusion implies some interdependence between the relevant factors, and in particular a similarity between the trade marks and between the goods or services. Accordingly, a lesser degree of similarity between the goods or services may be offset by a greater degree of similarity between the marks, and vice versa (29/09/1998, C-39/97, Canon, EU:C:1998:442). In the present case and taking into account this principle, the contested trade mark must also be rejected for the services found to be similar to a low degree to the services of the earlier trade mark as the obvious similarities between the signs offset the low degree of similarity between the services.

As the earlier right No 9 955 675 leads to the success of the application and the cancellation of the contested trade mark for all the services against which the application was directed, there is no need to examine the other earlier rights invoked by the applicant (16/09/2004, T-342/02, Moser Grupo Media, S.L., EU:T:2004:268).

Since the application is fully successful on the grounds of Article 8(1)(b) EUTMR, there is no need to further examine the other grounds of the application, namely Article 8(1)(a) and Article 8(5) EUTMR in conjunction with Article 53(1)(a) EUTMR.

COSTS

According to Article 85(1) EUTMR, the losing party in cancellation proceedings must bear the fees and costs incurred by the other party.

Since the EUTM proprietor is the losing party, it must bear the cancellation fee as well as the costs incurred by the applicant in the course of these proceedings.

According to Rule 94(3) and (6) and Rule 94(7)(d)(iii) EUTMIR, the costs to be paid to the applicant are the cancellation fee and the representation costs, which are to be fixed on the basis of the maximum rate set therein.

The Cancellation Division

Elisa ZAERA CUADRADO

Carmen SÁNCHEZ PALOMARES

Maria Belén IBARRA DE DIEGO

According to Article 59 EUTMR, any party adversely affected by this decision has a right to appeal against this decision. According to Article 60 EUTMR, notice of appeal must be filed in writing at the Office within two months of the date of notification of this decision. It must be filed in the language of the proceedings in which the decision subject to appeal was taken. Furthermore, a written statement of the grounds of appeal must be filed within four months of the same date. The notice of appeal will be deemed to be filed only when the appeal fee of EUR 720 has been paid.

The amount determined in the fixation of the costs may only be reviewed by a decision of the Cancellation Division on request. According to Rule 94(4) EUTMIR, such a request must be filed within one month from the date of notification of this fixation of costs and shall be deemed to be filed only when the review fee of EUR 100 (Annex I A(33) EUTMR) has been paid.